News
Siemens sale pending
The most pervasive rumor in the ATM industry has Diebold about to purchase the Retail and Banking Systems unit of Siemens Nixdorf, in an effort to boost its European business.by Ann All, editor
October 10, 1999
One of the worst-kept secrets in the ATM industry is that a prominent American ATM manufacturer is about to purchase Siemens Nixdorf's Retail and Banking Systems unit. Analysts speculate that Diebold will buy the Siemens unit, possibly in the next few weeks, to beef up its overseas sales, distribution and manufacturing. Since its distribution agreement with IBM was dissolved in 1997, Diebold has established subsidiaries in some European countries, including Poland and France. Yet analysts say the company's distribution network has suffered. "I think there are certain parts of the world in which Diebold feels very comfortable, while there are other areas they recognize a need to strengthen," said Kartik Mehta of Cleveland-based Midwest Research Inc. A buy also would help Diebold improve its time-to-market, since the company would gain a German production facility. Currently all Diebold machines slated for Europe are manufactured in the U.S. and shipped overseas. Munich-based Siemens leads the ATM market in Germany with a 40 percent share, according to Retail Banking Research Ltd. Siemens is also number two in Europe and number four in the world. A sale would benefit Siemens by helping the company "refocus," Mehta said, since the unit isn't a core part of its business. While some reports put the purchase price of the unit as high as $1.5 billion, Mehta thinks the actual figure is likely to be closer to $800 million. Diebold could recoup some of its investment by selling the retail part of the business, which produces POS terminals, cards and other peripherals. Diebold spokesperson Tiffini Bloniarz did not comment on a possible deal with Siemens but said Diebold is definitely interested in international expansion."We foresee consolidation in the ATM industry and are always looking at ways to be a consolidator and to expand our operations internationally." NCR is another rumored bidder for Siemens. Mehta discounts that theory, noting that a purchase doesn't make much sense for a company that already has a whopping 48 percent share of the European market. He also dismisses a more farfetched rumor, which has a group of European investors putting together a leveraged buyout of Siemens. "I don't think anybody is looking to get into the ATM business other than those who are already in it," he said.
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Diebold Nixdorf
As a global technology leader and innovative services provider, Diebold Nixdorf delivers the solutions that enable financial institutions to improve efficiencies, protect assets and better serve consumers.
